CGTMSE To Cover Retail Trades & Collateral Loans also

CGTMSE Coverage extended to Retail Trade & Collateral Loans also – Now Retail Trades & partial collateral loans may be covered under Credit Guarantee Scheme of CGTMSE. A decision in this regard taken under “Rebooting CGTMSE” organized by Ministry of MSME and CGTMSE on February 20, 2018.

The objective of the Credit Guarantee Scheme is to strengthen the credit delivery system and facilitate flow of credit to the MSE entrepreneurs without the hassles of collateral security and / or third party guarantee by enhancing the comfort level of the MLIs.

CGTMSE has introduced a new “Hybrid Security” product allowing guarantee cover for the portion of credit facility not covered by collateral security. In the partial collateral security model, the MLIs will be allowed to obtain collateral security for a part of the credit facility, whereas the remaining part of the credit facility, up to a maximum of ₹200 lakh, can be covered under Credit Guarantee Scheme of CGTMSE.

The above change of allowing partial collateral security under the ambit of Credit Guarantee Scheme of CGTMSE shall be applicable to fresh credit facilities sanctioned by MLIs on or after April 01, 2018.